The effects of firms’ R&D and innovation activities on their survival: a competing risks analysis

Pål Børing ()

Empirical Economics, 2015, vol. 49, issue 3, 1045-1069

Abstract: Using a data set of Norwegian firms, an examination is made of the relationship between firms’ R&D activities and their survival. A firm may exit the market through closure, or merger and acquisition (M&A). The analysis is based on a discrete time competing risks model with unobserved heterogeneity. We find that product-innovative firms have a higher probability of exit due to M&A, but only if they also introduce new products into their market. This highlights the importance of differentiating between different groups of product-innovative firms. None of the R&D and innovation activities considered has significant effects on the probability of firm closure. Copyright Springer-Verlag Berlin Heidelberg 2015

Keywords: Competing risks model; Firm closure versus M&A; Firm survival; Innovation; Unobserved heterogeneity; C14; C41; O31 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (11)

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DOI: 10.1007/s00181-014-0901-z

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